They say there is strength in numbers, so many companies are finding that to survive in times like these, they must band together.

Westvaco, a mid-sized paper-products company, is no exception. As it reports earnings on Tuesday, shareholders may be more interested in how its merger deal with Mead Corp., a rival paper maker, is going.

The merger deal has been the victim of troubled times. Westvaco CEO John Luke and Mead CEO Jerome Tatar first announced their deal on Aug. 29, and the initial market reaction was good. Westvaco shareholders bid the stock up on anticipation that the two companies would find cost efficiencies better together than they had apart.

But after several days, Westvaco stock began to drop on fears that the deal would not go through. And then came Sept. 11 and the subsequent stock market sell-off, from which Westvaco has yet to recover.

Westvaco and Mead have already announced that they will be closing plants, “streamlining operations” and “relocating equipment.” Analysts say as much as 10 percent of the 32,000-member work force of the combined companies might be laid off.

“The companies are beginning to realize people are skeptical [of the merger] and as a result are taking stronger actions,” said Mark Wilde, managing director and paper industry analyst with Deutsche Bank Alex.Brown.

“Both are shutting down less-efficient plants and have talked about selling up to a million acres of timber,” he added. “Those are pretty constructive moves.”

“The new company is going to be very efficient,” agreed Tom Burnett, president of Merger Insight. “Not next week, but in a year or so.”

Indeed, most Wall Street analysts say they like the merger, which won European Union approval last week.

Estimates are the new company, dubbed MeadWestvaco Corp., will do about $8 billion in sales a year and reduce costs by about $325 million. Analysts said it could add a dollar a share to the bottom line.

The deal is better for Westvaco shareholders though, according to Wilde. “In reality, it’s an acquisition of Mead by Westvaco, with no premium really being paid,” Wilde said.

Officially, it is being called a “merger of equals.” Mead investors will get one share of the new MeadWestvaco for each share they already own, and $1.20 a share in cash when the deal closes.

Shareholders of Westvaco will get 0.97 shares of the new company for each one they own now. The companies are trying to get the deal closed before the end of the year and are only awaiting shareholder and U.S. regulatory approval – both of which are expected.

Wilde, like most analysts who follow the stock, has a “buy” rating on Westvaco. “It is among the cheaper paper stocks right now,” he said.

Westvaco is expected to report quarterly profits of 24 cents per share. That’s down from 78 cents per share posted in the same quarter last year.